Item 1.01 Entry into a Material Definitive Agreement.
On February 19, 2014, the Registrant entered into a Securities Purchase
Agreement with certain investors under which it issued 10,000,000 shares (the
"Shares") of its common stock, par value $0.0001 per share (the "Common Stock"),
at a purchase price of $0.05 per share, for aggregate gross proceeds to the
Registrant of $500,000 (the "Private Placement").
In connection with the closing of the Private Placement, the Registrant's Chief
Executive Officer, C.E. Rick Strattan, converted his share of Series A Preferred
Stock, par value $0.0001 per share (the "Series A Preferred Stock") into one
million shares of the Registrant's Common Stock. The share of Series A Preferred
Stock was the only share of Series A Preferred Stock outstanding. Initially
issued in 2004 to Mr. Strattan in exchange for the surrender of 1,029,412 shares
of Common Stock then owned by him, the Series A Preferred Stock carried certain
voting rights that entitled its holder to cast a number of votes representing a
majority of the votes entitled to be cast by all of the Registrant's capital
stock. It was convertible by its terms into a number of shares of Common Stock
to be agreed mutually by the Registrant and the holder at the time of
conversion. The conversion was effected through a Conversion Agreement, dated as
of February 19, 2014, between the Registrant and Mr. Strattan. The conversion of
the Series A Preferred Stock was a condition to the closing of the Private
At the closing of the Private Placement, as required by the Securities Purchase
Agreement, the Registrant and Mr. Strattan also entered into the Voting
Commitment Letter described in more detail under Item 5.02 below, in support of
the board appointment rights described in that item.
Each of the Securities Purchase Agreement, the Conversion Agreement and the
Voting Commitment Letter are attached as exhibits to this Current Report on Form
8-K. The summaries of these agreements are qualified in their entirety by
reference to the agreements attached as exhibits to this report.
Item 3.02 Unregistered Sales of Equity Securities.
The information set forth above under Item 1.01 is incorporated into this Item
3.02 by reference. The Shares were issued in a transaction exempt from the
registration requirements of the Securities Act of 1933, as amended, by virtue
of the private placement exemption in section 4(a)(2) of that Act and/or the
provisions of Regulation D promulgated thereunder.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
In connection with the Private Placement, the Registrant's Board of Directors
voted to increase the size of the Board of Directors from three members to five
members, and voted to fill the resulting vacancies with N. Scott Fine
, two of the investors under the Securities Purchase Agreement, in each
case effective as of the closing of the Private Placement. Under the Securities
Purchase Agreement, the Registrant will use its reasonable best efforts to
include both Messrs. Fine and Sieger (or a representative of either of them, at
their respective individual elections) in any proxy statement of the Registrant
soliciting proxies for the election of directors. These board appointment rights
will terminate on the seventh anniversary of the Private Placement.
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As a condition to the Private Placement, the Registrant and Mr. Strattan
into a Voting Commitment Letter dated as of February 19, 2014
, under which Mr.
has agreed, until the seventh anniversary of the Private Placement, (i)
to vote or cause to be voted all of the shares of Common Stock beneficially
owned by him as of the applicable record date, at any meeting of shareholders
called for the purpose of electing directors of the Registrant, "for" the
election to the Board of Directors of the slate of directors nominated at such
meeting by the Board, and (ii) not to support or participate in any "withhold
the vote" or similar campaign, or support any other nominees other than the
slate of directors nominated by the Board (including the representatives of
Messrs. Fine and Sieger, as the case may be). In order to amend the Voting
Commitment Letter, the Registrant would require the approval of a majority of
its Board of Directors including each of the two investor representatives
Neither Mr. Fine
nor Mr. Sieger
is a party to, or has a material interest in,
any transaction that would require disclosure under Item 401(a) of Regulation
Item 7.01 Regulation FD Disclosure
On February 20, 2014
, the Registrant issued a press release announcing the
Private Placement, a copy of which is furnished as Exhibit 99.1 to this Current
Report on Form 8-K.
Item 9.01 Financial Statements and Exhibits
10.1 Securities Purchase Agreement dated as of February 19, 2014
, between and
among CTD Holdings, Inc.
and the purchasers named therein
10.2 Conversion Agreement dated as of February 19, 2014
, between CTD Holdings
Inc. and C.E. Rick Strattan
10.3 Voting Commitment Letter dated as of February 19, 2014
, between CTD
Holdings, Inc. and C.E. Rick Strattan
99.1 Press release dated February 20, 2014
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